Deduction of Zakat

2026 PLD 355 LAHORE-HIGH-COURT-LAHORE Judicial Precedent

Ss. 3 & 5Zakat and Ushr Ordinance (XVIII of 1980), S.24Deduction of ZakatExemptionCharitable institutionProofPetitioner / University was aggrieved of deduction of Zakat on its investments made with a financial institution

Plea raised by petitioner / University was that it was a charitable institution and was exempted from deduction of Zakat

Validity

Petitioner / University was established for paramount national interest to establish a center for advancement of education and learning of internationally acknowledged standards to the talented and deserving students of Pakistan

Petitioner / University was neither alleviated institution to the category of a charity nor there existed any operative provision in Foundation University Ordinance, 2002 for its declaration to be a charitable institution

Liability to Zakat was attached to prescribed assets held by a person or institutions defined under the law, subject to only those exemptions, which were expressly provided under S.24 of Zakat and Ushr Ordinance, 1980

Nature and character of petitioner / University, whether statutory, chartered, public service or otherwise, did not by itself create immunity, unless such immunity was grounded in the statute which the petitioner / University had failed to bring on record

Under the law, where the Legislature intended exemption, it had done so explicitly

Absence of such expression must be construed as deliberate

Petitioner / University did not place on record any specific document, nor pointed out any specific provision in its parent statute or in Foundation University Ordinance, 2002 granting exemption from Zakat liability

High Court in exercise of Constitutional jurisdiction declined to interfere in the matter as the petitioner / University failed to demonstrate any illegality in the letter issued by authorities holding petitioner / University liable to deduction of Zakat

Constitutional petition was dismissed in circumstances.

2009 PTD 1499 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Ss.18 & 136Deduction of ZakatAppeal to High Court

Question proposed for the opinion of the High Court was "whether the Tribunal was justified in directing the Assessing Officer to allow deduction of Zakat against the income including other head of Income"

Said issue having already been settled by the High Court in case 2003 PTD 1309, question was answered in affirmative in favour of assessee and against the department.